Aging is an inevitable part of life, and it may come with significant caregiving challenges for many families. This fact is why discussing the cost of long-term care, and learning how you could prepare for it, can be so important.
From budgeting for these costs as part of your retirement savings to purchasing long-term care insurance, there are many strategies your family can consider to help ensure you get the care you need and deserve.
What Is Long-Term Care?
As you get older, you may need more assistance with everyday tasks — or around-the-clock care if you have health issues that affect your mobility, memory or cognitive abilities. Often, a relative may step in to act as a family caregiver, but sometimes this just isn't possible. Your loved ones may live far away, for example, or you may require constant care from a trained and qualified health care provider. Long-term care can become an essential consideration in these instances.
There are several types of long-term care assistance available, including assisted living facilities, nursing homes and in-home care.
- Assisted living facilities: These facilities cater to people who may need help with some daily tasks — such as dressing, eating and bathing — but don't require 24/7 care in a nursing home. There are many assisted living facilities in the U.S., some of which are located within nursing homes or retirement communities. Trained health care professionals, including nurses, doctors and other support staff, provide care to residents in these facilities. This care can include everything from making sure a resident takes their medication to housekeeping duties, planning activities and providing transportation.
- Nursing homes: The U.S. government regulates these homes, and some of these facilities are even paid for by Medicaid or Medicare. Nursing homes have trained staff on hand to provide care and administer medications. Doctors are also on hand to supervise the health care patients receive. Nursing homes are designed for seniors who need a lot of ongoing care, which could make them a costly option if your family isn't in a position to cover out-of-pocket costs.
- In-home care: This option is often less expensive than assisted living facilities or nursing homes. With in-home care, a trained home health aide will come to your home and provide a range of services. These can include everything from making sure you take your medication at the right times (and in the correct dosage) and treating any wounds or infections to monitoring your vitals, helping you get proper nutrition and coordinating your care among health care providers. Generally, in-home care isn't designed for someone who has a serious chronic condition (or multiple conditions) that requires a higher level of around-the-clock care.
Preparing for the Cost of Long-Term Care
According to the Department of Health and Human Services, pricing for long-term care can vary significantly, depending on the type of care you need. Average costs for nursing homes range from $6,844 to $7,698 per month, while the average cost of an assisted-living facility is $3,628 a month. The average cost of in-home care can be $20 per hour for a home health aide.
So, if you ever need long-term care, how would your family cover the cost?
- Personal or retirement savings: For some people, the first and most obvious answer is to withdraw from their personal or retirement savings. If you start saving early, this could help you build up enough to cover the cost of long-term care. For example, if you've put money into your retirement account over the last 20 or 30 years, you may have enough to help cover these costs for a certain period — if not indefinitely.
- Family financial support: Financial support from family members can also be used to supplement the cost of long-term care. But it's important for families — especially aging parents and adult children — to discuss if it's possible for family members to contribute (and just how much they can afford).
- Long-term care insurance: Most people don't want to burden their family with these costs — even if relatives may be willing to help. This concern is why long-term care insurance could be an excellent choice. With long-term care insurance, you pay a monthly premium for coverage that could help you cover the cost of a nursing home, an assisted living facility or in-home health care. Also, if you purchase this insurance type when you're younger, you may be able to get lower premiums.
In life, it can be helpful to prepare for both certainties and uncertainties — and aging is a little of both. While you hope to age with grace and remain independent and active, there's no guarantee this will happen. There's always the possibility you may need help from others to take care of yourself. This reality is humbling but think twice before you let it stop you from doing everything possible to prepare. You won't know whether you will need long-term care until it's time — but saving for these costs during your working years and getting long-term care insurance could help you become more financially ready.